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January 10, 2017

7 Personal Finance Trends You Can Exploit

Key trends in the world of personal finance today require a shift in mindset for most Canadians to maximize their short and long-term financial success. These trends are making the concept of financial self-reliance more important than ever before. In this overview we examine a few of these trends and how you can get ahead of these trends to maximize your own wealth.

Trend 1: Higher Levels of Challenge and Opportunity

In today’s world we face more complex challenges in our day to day lives compared with previous generations. The silver lining is that there is an overwhelming amount of information available to help us solve many of our challenges. The fact that you’re reading this article means you have access to the internet and therefore more access to information and opportunity than any of your ancestors. The overwhelming amount of also means we may feel more pressure to “succeed”, and too much information can make it tough to narrow down the best path to achieve your goals and truly focus.

Trend 2: Demographic Shifts

Demographic shifts are another reality of our present world. For example, the Dunphy family featured on the TV show “Modern Family” would be a strange concept to many Canadians before the turn of the century, but is now a pretty easy family for most to relate to. Today we see less of the “traditional” nuclear family unit, more single / solo households, more double income families, and fewer children per family.

A key consideration with shrinking family size and longer life-expectancies is that there are going to be more aging retirees with less working age taxpayers to fund the promises made to our older generation. This is likely to mean higher taxes in the future, less dependable retirement benefits for today’s working generation, and a greater need for financial self-sufficiency.

Trend 3: Standard of Living

Consider that indoor plumbing (let alone indoor washrooms) only became commonplace within the past 100 years in North America… and that now we can hardly fathom being separated from our smart phones. No doubt, our standard of living has increased and with high levels of technological innovation, we can expect the standard of living to continue to increase at a rapid pace.

Trend 4: Rising Living Costs

As our standard of living increases, we also see living costs increasing. Not only do more things become “standard”, the increasing costs of many basic goods and services has outpaced the growth in income. Housing affordability is a key example… current affordability is poor despite record low interest rates.

Trend 5: Low Interest Costs

Interest rates have been hovering at or near historical lows for nearly 2 years, and while initial expectations were that they would rebound sharply, bond yields now show that relatively low interest rates are here for the foreseeable future and rate increases are likely to be more gradual than initially expected. We can consider this an opportunity.

Trend 6: Realities of Retirement

When it comes to retirement, it’s a topic many Canadians don’t want to discuss because they are scared to face the realities of retirement. Increased living costs and low savings rates mean that the retirement dreams of many Canadians are far from reality, and severely underfunded. The near extinction of defined-benefit retirement plans and increases in life expectancy mean a longer retirement period and highlight the fact that financial self-reliance is more important than ever before.

Trend 7: Wealth Planning

High taxes mean wealth planning is a more important consideration than ever before, especially for high net worth individuals who are unlikely to outlive their available resources. The savings from effective estate planning and business succession planning can be substantial, and the difference in wealth available for future generations or charitable giving can be multiplied by starting estate planning as early as possible.

How You Can Personally Exploit the Trends

Info is great, but properly applied info is far better… so how can you benefit and get ahead of the trends?

First, understand the trends so you can make smart decisions based on where the world is heading.

Second, be strategic about how you’ll exploit these trends for your own personal gain. Make sure you have great advisors that can provide expert advice and help you truly take advantage of your current resources and understanding of these trends.

Third, consider leverage since the current low interest rate environment combined with high housing prices means many Canadians have an unprecedented opportunity to borrow funds at a low cost of borrowing which can be used to catch up on underfunded retirement goals.

No mortgage or financial planning team in this country does more borrowing to invest or borrowing for wealth creation than our team. We have the business track record and formal education to support your plan and to help you achieve your financial goals. Volatile markets create opportunities and we would love the opportunity to help you capitalize. Call our office today to discuss how we can help at 1-855-410-9905 or email ClientCare@MortgageManagement.ca

Calum is a passionate, energetic, and results focused wealth advisor and nationally recognized leader and speaker in the field of mortgage banking and financial planning. He has accumulated numerous industry awards, been ranked as the top producing mortgage professional in the country by Canadian Mortgage Professional Magazine, and has funded over $2.2 billion worth of residential mortgages (representing over 5,000 transactions) to date.

Calum is regularly featured in the media as a mortgage expert including TV appearances on CBC, Global, CTV and BNN. In addition being seen on air, Calum has contributed to mortgage, personal finance, and real estate articles in The Globe and Mail, The National Post and numerous other publications.

With over seven years of post-secondary finance education from top globally ranked business schools, including the Schulich School of Business and Harvard Business School, and extensive formal training in the field of personal finance, there is no personal finance professional better qualified to service your mortgage and financial advisory needs.

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Formerly operating as Calum Ross Mortgage. Please note we are not currently open to the general public. To work with our team you must be an existing client (someone who has completed a mortgage with our office before), referred by an existing client, or a Keyspire member.

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To work with our team you must be an existing client (someone who has completed a mortgage with our office before), be referred by an existing client, be a graduate of an accredited medical program, or be a Keyspire member.